im not sure if its normal or not but fuck the notion of normal arousal as long as he isnt seriously harming anyone or doing anything illegal then its all good and since youve decided to embrace it i think your best bet is to tell him that you know that hes into it assuage any fears that he might have as to why hes covered it up from you and then ask him if there are any ways you can help him work out any tranny fantasies of his that sounds like a pretty awesome gf plan right there